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Cost of fixing nation’s apartment crisis ‘in the billions’

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New research estimates that fixing defects in apartment buildings constructed in the last decade will cost $6.2 billion.

The independent report – commissioned by the Construction Forestry Maritime Mining and Energy Union – also says an estimated 3461 residential buildings containing 170,000 apartments have combustible cladding.

The worst is in NSW (1411 buildings), followed by Victoria (1069), Queensland (570), the ACT (157), WA (154), SA (69) and NT (31).

The total value of new apartment construction in 2018-19 is $31.7 billion – 14% of the building and construction sector.

The report blames the “systematic weakening of government as the protector of the public interest in an industry that is riddled with asymmetries, informational and financial”.

It says building standards haven’t been enforced or kept pace with evolving building practices. Public sector skills and capability have been lost, leading to poor project scoping and design, and outsourced building approvals have resulted in conflicts of interest and no oversight.

Many of the operators cutting corners on building quality are the same ones cutting corners on worker safety, the report says.

“In what amounts to a sort of ‘cognitive dissonance’ in public policy, our political and industry leaders are well aware that we have a massive problem on our hands, but are paralysed by the fear that the necessary actions required to improve our industry could dampen activity in a still otherwise fragile national economy.”

The report calls for the strictest practical standards to be applied to new construction, saying maximum transparency needs to be introduced in the country’s existing housing stock.